’Cheaper to fly overseas than to Townsville’
AIRFARES in regional Queensland are among the highest in the world, with consumers complaining it is cheaper to fly return from Sydney to Los Angeles than Cloncurry to Townsville, a report has found.
The Senate's Rural and Regional Affairs and Transport References Committee inquired into the operation, regulation and funding of air services to rural, regional and remote communities.
Its report says the high costs have "a direct and detrimental effect" on residents.
"A lack of access to affordable airfares reduces the opportunities for residents to, among other things, attend family events, medical appointments, sporting events or explore and develop business opportunities," the report says.
It recommends the government ask the Productivity Commission to investigate regional pricing, including whether operational subsidies can be increased or other price controls can be introduced.
In a submission, Cloncurry resident Hamish Griffin says he was quoted nearly $4800 by Qantas to fly return with his wife and four-year-old son to Townsville.
Mr Griffin said he checked other prices on the same days and dates, finding it was cheaper for them to fly return from Sydney to Los Angeles or from Sydney to London.
In another submission, Mount Isa City Council said it found the cost for a family of four to fly return from Mount Isa to Brisbane was $3500, while the cost from Townsville was $1150. It meant the family could save about $2000 if they drove to Townsville to fly to Brisbane.
The committee said that, based on the evidence, it could not form the view that there was "price gouging" or other market manipulation.
"While the committee notes that such a finding may frustrate residents who consider that regional airfares are unnecessarily excessive, the extensive evidence put before the committee in this inquiry does not allow such a conclusion to be reached," it said.
"It appears to the committee that the main driver of airfares - in any region - are genuine market forces and economies of scale."
The report said there were fixed costs attached to the operation of an aircraft, such as fuel, staffing, and passenger and security charges.
"These costs, combined with low population numbers and therefore low load factors, lead to higher airfares," it said.